Gartner Inc. has once again lowered its capital spending forecasts for 2008. Capital spending and the fab equipment markets are expected to decline next year. 

Overall capital spending is projected to hit $59.1 billion in 2007, up 4.9 percent over 2006, according to Gartner. Capital spending is projected to go into negative territory and fall by 13.2 percent to $51.3 billion in 2008, according to the research firm.

Worldwide semiconductor capital equipment spending is forecast to total $44.8 billion in 2007, a 6.8 percent increase from 2006. The market is expected to hit $40.3 billion in 2008, down 9.9 percent.

The numbers are far worse than Gartner's last forecast in October. "2007 was marked by continued strong DRAM investments, shrugging off the realities of a market sector in oversupply, slower NAND spending growth, and disappointed hopes of a foundry spending revival," said Klaus Rinnen, managing vice president for Gartner's semiconductor manufacturing group, in a statement.

"As we look to 2008, we expect the long overdue capital spending correction in the DRAM market to push the capital equipment market into contraction. Adding on the downside is another slow year from foundry and generally more cautious spending mood, with concerns about a US economic recession rising," he said.

"On the positive side, NAND flash spending should continue to ramp," Rinnen added. "And a firming pricing picture for logic device segments brings manufacturers hope for some upside in capacity spending from this segment."

By: DocMemory
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